The present invention relates to a trade exchange system and in particular to a world trade exchange having a central exchange host for providing international commodity information and a plurality of local exchanges in various sites around the world wherein a plurality of user computer terminals coupled to each of said local exchanges can request and receive data representing marketing information directly from the central exchange host and transmit data representing bids and offers to its local exchange.
There are many different types of commodity exchanges in existence, such as the New York Stock Exchange, the Chicago Board of Trade, and the like. Normally, these exchanges function by having brokers who represent clients in buying or selling commodities through the particular exchange, as well as obtaining market information from the exchanges for clients regarding market activity. The markets include, but are not limited to, the futures market, cash market, oil market, stock market, and securities market.
Recently there has been an increase in automated trading exchanges having a central processor associated with one or more remote terminals through which trades can be made by members of the exchange or that provide market information to members of the exchange upon request. Such a system is described in U.S. Pat. No. 3,573,747 which, for instance, allows institutional investors to communicate anonymously with each other for the purpose of arranging trades of listed and over-the-counter securities.
While the automated systems provide many advantages for traders such as preventing or at least inhibiting market manipulation, increasing the speeds at which trades are made, time dating the purchase or sale of a particular commodity, and the like, there is still no practical provision in the art for exchanges located at various sites around the world being able to communicate with each other and allow users in one exchange to trade through electronics directly with users who are members of other exchanges around the world.
The present invention overcomes the disadvantages and problems of the prior art by providing a central exchange host arrangement and system that is in communication, through means such as a satellite system, with local exchanges located at various sites around the world. A remote terminal user member of any one exchange can trade with a remote terminal user member of its own exchange or with a user member of any other exchange around the world through its local exchange and the central exchange host which monitors all of the trades in each of the local exchanges and provides market information to a remote terminal user member that belongs to any of the local exchanges at the various sites around the world. Thus, the user member of any one local exchange can communicate directly with the central exchange host to obtain market information relative to any member exchange. He can also make bids and offers to any other local exchange user member through his own local exchange which communicates through the satellite system with the central exchange host and with the other selected exchange. Thus, if a user member of the World Energy Exchange in Dallas would like to obtain market information concerning trading of a particular commodity on a Paris commodity exchange, he may communicate directly with the central exchange host and obtain that informattion. If the same user member wishes to trade with another user member of the Paris Commodity Exchange, he would enter a bid or an offer through his remote terminal to his local exchange which would then communicate that information to the central exchange host and then to the Paris Commodity Exchange through the satellite system where the bid or offer would be displayed on the user member remote terminal. Thus, a user member of the Dallas World Energy Exchange could effect a commodity trade with a user member of the Paris Commodity Exchange or any other member exchange around the world.
The commodity information and trading transaction paths from the individual local commodity exchanges takes places as follows. A central gathering point (central exchange host) of commodity information from the individual local commodity exchanges is established. The commodity information will come in via land or satellite communication connections. The information is then transmitted via satellite(s) world wide to local exchanges. The traders have the necessary equipment to receive the broadcasted commodity information at remote user terminals and sort out and display the preselected individual exchanges around the world with which they wish to trade as well as displaying the commodities in which they are interested. From the correlations and observation of the commodity information the trader decides upon a position (i.e., bid or offer). The desired position is entered and transmitted via satellite to the central gathering point and routed to the individual local commodity exchange(s). Upon confirmation of receipt by all involved local commodity exchanges participating in the submitted position and the acceptance of the position by another trader, the central exchange host transmits a position confirmation to the individual trader at the remote user terminals completing the establishment of a position transaction.
Information flow is then in two basic forms. First, the gathering and subsequent worldwide broadcast of participating local commodity exchanges marketing information. This commodity marketing information is received in bulk by the traders' rremote user terminals where it is selectively displayed. The second information flow is independent of the first but uses the same communications paths. The second information flow is a transaction consisting of the entry of a proposed commodity trading transaction and the notification of its acceptance by a trader member of the designated local exchange. The established position and its subsequent liquidation or completion is also routed through the central exchange host.
A touch screen data entry system is associated with the remote user terminals screen display for displaying input information and data representing the bids and offers. By physically touching symbols representing a bid or an offer, the commodity selected, and the local exchange selected, the pertinent data is input from the user terminal into the system for transmission through the user's local exchange, the central exchange host, and the selected local exchange to the remote user terminals associated with the selected exchange.